Mindtree declares 1:1 bonus, revenues up 2.3% in Q3; Bagchi steps down in management rejig

Mindtree declares 1:1 bonus, revenues up 2.3% in Q3; Bagchi steps down in management rejigThe Bombay Stock Exchange, the oldest stock exchange in Asia, is again planning to get listed. Picture: BSE buildingwikimedia

Update

The board of directors of Mindtree have recommended bonus shares in the ratio of 1:1, subject to requisite approvals from regulatory authorities and shareholders.

This will be the second bonus issue in two years.

However, the stock ended with a loss of 4.51% on Monday at Rs 1,469.60 on the BSE.

The directors at their meeting on 18 January to review the third quarter results, also recommended an interim dividend of 40% for the quarter ended 31 December, 2015.

Mindtree reported a 2.3% growth in its dollar revenues on a sequential basis at $184.4 million for the third quarter ended December 2015. However, net profit declined 3% q-o-q to $22.8 million, the company said in a regulatory filing on Monday.

The company said it has acquired Magnet 360, a salesforce platinum consulting partner, to increase its presence in the cloud-based services market.

The company also announced changes at the top. The current CEO & MD Krishnakumar Natarajan has been elevated to the post of Executive Chairman to replace Subroto Bagchi, who has stepped down from his position.

Rostow Ravanan will be the new MD& CEO.

“This is the culmination of a year-long succession planning exercise that the Board had undertaken after carefully considering several candidates. All the changes announced today will be effective April 1, 2016,” said Apurva Purohit, independent director and chairperson of the nomination and remuneration committee of the company’s board of directors.

Original story

The shares of mid-category IT services company Mindtree were trading with a loss of 2% on Monday afternoon, ahead of the company’s board deciding on a bonus issue of shares along with its third quarter results.

On 13 January, the company had informed the BSE that it will be considering a bonus issue on 18 January. The company’s previous bonus issue was in June 2014 in the ratio of 1:1.

The stock was trading at Rs 1504.90 at about 1 pm, down 2.22%.

For the quarter ended 30 September, 2015, Mindtree had reported revenues of $180 million, 22.6% growth on year-on-year (YoY) basis and net profit of $24.3 million, up 6.8% YoY.

For the second quarter, Mindtree had declared an interim dividend of 40% or Rs 4 per share.

Earlier in the day, Wipro declared its third quarter results, missing its IT revenue guidance marginally. The revenues were $1,838.1 million, as against the guidance of $1,841 million to $1,878 million.

For the fourth quarter, the Bangalore-based company issued a guidance range of $1,875 million to $1,912 million, an increase of 2 to 4% over its third quarter IT revenues.

The S&P BSE Sensex was trading with a loss of 100 points at 24,355. BHEL, Tata Steel, Axis Bank and GAIL (India) were gaining, while Bajaj Auto, Bharti Airtel, ONGC and Reliance Industries were dragging the Sensex down.

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